Officially Ontario ended its recession in 2009, but the effects still linger in 2013.
The Canadian Centre for Policy Alternatives estimates the “great recession” of 2008-09 and the slow recovery has taken the Ontario economy $70 billion off course. That means $12.4 billion in lost annual revenues to government – or more than our current deficit.
Austerity has not been successful in other jurisdictions, yet the Wynne government has so far said it will stay the course, impacting public services including health care.
The United Kingdom has now endured a triple-dip recession as a result of deep cuts in public spending by the Cameron government. Could more austerity by the federal, provincial and municipal governments send our own economy into negative territory, impacting both private and public sectors?
Traditional thinking has been you stimulate during lean years and grow out of your deficits in more flush times. In 2003 the Conservative government left Ontario a surprise deficit of $5.5 billion. Despite significant reinvestment in the public sector – including health – the province was able to quickly grow out of the deficit and run three years of balanced budgets.